CBS' Money Watch Should Be Crucified For This Erroneous Headline

If the author of the story, here, had bothered to read from the annual report of the St. Louis Federal Reserve to which he refers, and which adjusted the household net worth numbers for population growth and inflation from 2007, he would have observed that the maximum extent of the decline from which we have recovered 45% was something close to 27%. The helpful folks at the St. Louis Fed even provided a nice graph to make it easy to understand.

So, our net worth was never down 55% in the first place, and the anemic recovery we have experienced under Obama has brought us up only 45% from the 27% decline to which we had fallen. The dunderhead, no different from Rush Limbaugh nor any average high school graduate for the last forty years, incorrectly subtracted the 45% improvement from 100 to get 55, which shows he never learned the simplest thing about percentages in school.

As the graph clearly shows, we're still down about 15%, adjusted for population growth and inflation.

Here's the math: What's 45% of 27%? Answer: about 12 percentage points. Subtract 12 from 27 and you get 15 (85 on the graph at the left--add 15 to 85 and you get 100!).

Magic. 

Harrisburg PA Securities Fraud Just The Tip Of The Government Bond Fraud Iceberg

"Misleading public statements"? "Incomplete information"? Gee, isn't that the same fraud our elected officials specialize in these days, from an IRS official pleading the Fifth Amendment while asserting she's innocent to a Secretary of State stonewalling with "What difference does it make?" how someone who reported to her died?

Steven Malanga for The Wall Street Journal here:

With Harrisburg, however, the SEC has gone further and charged the city government with "securities fraud for its misleading public statements when its financial condition was deteriorating and financial information available to municipal bond investors was either incomplete or outdated." The SEC says this is the first time the regulator has "charged a municipality for misleading statements made outside of its securities disclosure documents."

The Harrisburg charges are part of a broader SEC effort to scrutinize state and local government issuers in the nation's $3 trillion municipal-bond market. "Anyone who follows municipal finance knows that budgets can sometimes be a work of fiction," says Anthony Figliola, a vice president at Empire Government Strategies, a Long Island-based consulting firm to local governments. "Harrisburg is the tip of the iceberg."

Gold/Oil ratio ends week at 15.14, and gold loses its relative advantage to oil

The edge goes back to oil, which, however, is probably going to keep declining in price, so there's no rush, especially since oil not that long ago had enjoyed an impressive "buy" relative to gold.

TSA Claims All Nude Scanners Now Gone

Nice belt!

Story here:

"[A]s of May 16, all US airports scanners equipped with the ability to produce the penetrating images will now only show a generic outline of a passenger to the operator."

Sorry Charlie, Household Net Worth Remains In Depression: Still 15% Off 2007 Peak

From the newly issued 2012 annual report of the St. Louis Federal Reserve here, taking the nominal figures in the March Z.1 Flow of Funds Release of the Federal Reserve and adjusting them both for inflation and population growth since 2007:

"Clearly, the 91 percent recovery of wealth losses portrayed by the aggregate nominal measure paints a different picture than the 45 percent recovery of wealth losses indicated by the average inflation-adjusted household measure. Considering the uneven recovery of wealth across households, a conclusion that the financial damage of the crisis and recession largely has been repaired is not justified."

Completed Foreclosures Still Running 148% Higher Than Normal

According to Corelogic's monthly foreclosure report, here, completed foreclosure activity is still running at a rate of 52,000 per month in April, down from 62,000 per month a year earlier.

The average monthly rate before the financial panic, however, was 21,000 per month, making the current rate, though improved, nearly 148% higher than was the case in the years between 2000 and 2006.

But don't worry, everyone says things are better now and housing has recovered.

GDP For Q1 2013 Revised Down To 2.4% From 2.5% In Second Estimate

From the report of the Bureau of Economic Analysis, here:

Real gross domestic product -- the output of goods and services produced by labor and property located in the United States -- increased at an annual rate of 2.4 percent in the first quarter of 2013 (that is, from the fourth quarter to the first quarter), according to the "second" estimate released by the Bureau of Economic Analysis.  In the fourth quarter, real GDP increased 0.4 percent.

The GDP estimate released today is based on more complete source data than were available for the "advance" estimate issued last month.  In the advance estimate, real GDP increased 2.5 percent.

To put the second estimate of Q1 2013 real GDP in context, a real rate of growth of 2.4% now is just slightly ahead of the average report of 2.23% during George W. Bush's first term in office. But compared to Barack Obama's first term, it's a world of difference from his performance in his first term with a paltry 0.83% average report.

That said, it used to be the opinion of Ben Bernanke, the Federal Reserve chairman, back in July 2009 that we needed 2.5% growth just to keep the jobless rate constant. That's why under Bush it took so long for jobs to recover after 911. And it's why jobs are taking so long to recover now. With growth of just 2.4%, going forward all we can expect is the current level of unemployment. And you can forget about putting the millions who lost their jobs in the recent financial panic back to work in decent jobs, maybe ever.

Price Discovery In Health Care

The past is the future: Doctor in Maine stops taking insurance, cuts prices in half and posts them online.

Story here.

Stupid: Well, There It Is

P.J.O'Rourke, here:

Call a man, best of all, wicked and you get to don the sacramental vestments, climb into the pulpit and thunder forth with such a sermon as to bring him weeping to the font of righteousness or cause the Lord God Almighty to strike him with a thunderbolt in his pew or something fun like that. But call a man stupid and . . . there it is.

And there it is: Dopey stimulus, obtuse bailout, noodle-headed Obamacare, half-wit Dodd-Frank, damfool IRS Tea Party crashers, AP and Fox News beset by oafish peeping Toms and the Benghazi tale told by an idiot. One could go on. Stupid is a great force in human affairs. And the great force has a commander in chief.

IRS' Shulman Visited White House 9 Times In '09 Alone, Everson Once In 5 Years

The former IRS Commissioner Douglas Shulman is widely reported to have visited the White House well over 100 times after 2008 when he took over the agency, just as the IRS was preparing to target Tea Party groups in earnest.

What's more interesting, however, isn't the aggregate number of visits he made, most of which occurred in the wake of the passage of ObamaCare in 2010 and which are detailed in the logs as health-care related discussions, but that he made so many visits to the White House prior to March 2010.

Earl Glynn here has made an exhaustive study of the White House logs and finds Shulman visited the White House 9 times in 2009 alone.

Shulman's predecessor Mark Everson, by contrast, recalls making just one visit to the White House in the five years between 2003 and 2007, as reported by Susan Ferrechio here:

'The frequent trips to the White House under Obama far outnumbered the times other administrations felt the need to meet with the IRS, according to Mark Everson, who led the IRS under former President George W. Bush. Everson said he remembers making only one trip to the White House between 2003 and 2007 and said he felt like he'd "moved to Siberia" because of the isolation.'

In Shulman's testimony before Congress he has denied discussing targeting of Tea Party groups, but he also testified that he doubted he visited the White House as many times as reported, as recounted here:

He also expressed skepticism that he had visited 118 times.

“I don’t accept the premise that there are 118 visits to the White House,” he objected. “That may or may not be true.”

Yeah right, that's because there were 157 visits, not 118.

The guy's a Slick Willie who absolutely must parse so that if and when we get the goods on the guy at least he'll avoid a perjury charge:

[A]ll of Shulman’s answers were parsed and delivered in practiced legalese.  He almost never answered anything with simple assertions, opting for “recollections” and “as far as I can remembers.”  In his apparent painstaking efforts to avoid making any statement that might ensnare him in a perjury controversy, Shulman seemed unable to cleanly field simple questions about his opinion.  So he hedged and qualified and dissembled — and looked really guilty doing so. 

IRS' Lois Lerner Actually Signed Letters To Targeted Tea Party Groups

The story is here:

"The IRS official who refused to testify this week -- while claiming she had done nothing wrong -- signed letters to Tea Party groups a year ago that asked them to turn over everything from printouts of their Facebook pages to the credentials of speakers who participated in their events." 

Hillary, Holder and Shulman: Obama's Know-Nothing Government Zoo?

Hillary Holder and Shulman

Jonathan Turley in The Washington Post, here, warns about the growth of Leviathan, the administrative state, which makes monkeys out of its politically appointed overseers (or does it?):

There were times this past week when it seemed like the 19th-century Know-Nothing Party had returned to Washington. President Obama insisted he knew nothing about major decisions in the State Department, or the Justice Department, or the Internal Revenue Service. The heads of those agencies, in turn, insisted they knew nothing about major decisions by their subordinates. It was as if the government functioned by some hidden hand.

Clearly, there was a degree of willful blindness in these claims. However, the suggestion that someone, even the president, is in control of today’s government may be an illusion. ...

For much of our nation’s history, the federal government was quite small. In 1790, it had just 1,000 nonmilitary workers. In 1962, there were 2,515,000 federal employees. Today, we have 2,840,000 federal workers in 15 departments, 69 agencies and 383 nonmilitary sub-agencies. ...

[T]he Supreme Court ruled in 1984 that agencies are entitled to heavy deference in their interpretations of laws. The court went even further this past week, ruling that agencies should get the same heavy deference in determining their own jurisdictions — a power that was previously believed to rest with Congress. In his dissent in Arlington v. FCC, Chief Justice John Roberts warned: "It would be a bit much to describe the result as ‘the very definition of tyranny,’ but the danger posed by the growing power of the administrative state cannot be dismissed.”

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Doesn't this line of argument smell just a little like a pre-emptive defense of the bad monkeys who were actually up to no good? Perhaps a diversionary tactic? Throughout the article, Turley constantly refers to the untouchable agencies as "the fourth branch" of the government. Isn't this a deliberate rhetorical shift? The fourth estate, the press, has been the traditional conception from the time of Carlyle. The fourth branch appears to be a recent innovation, a neologism originating in a leftist critique of the media when captured by the elected, usually Republican, government (as fine a description of the current Obama regime as any, which might be a reason Turley seeks to redeploy the term for what conservatives have long termed the managerial state to keep the focus off the compromised media--it's more prudent for a liberal to change the subject from media complicity when it's media complicity with liberalism we're talking about).

It's also suspicious when liberals start talking like conservatives just when their side starts getting its feet held to the fire. And isn't it also a little rich to hear John Roberts warning about the growing power of the administrative state when on behalf of the third branch of government he basically shoved ObamaCare down the throats of the American people against their will? Or is Leviathan so irresistable that the judiciary follows the legislative in ceding its own power to the faceless bureaucracy?

It would probably behoove the cause of liberty more to forego a special prosecutor in the IRS scandal at this time simply in order to keep televised hearings before the eyeballs of all. Educating the people about the malfeasance of the so-called fourth branch under Obama is job one in order to pierce the fourth estate's media halo around their hero Obama.

America Still Stands Despite Enemies Foreign . . .

. . . and domestic.

Obama's Tea Party Attack Dog Bob Bauer Is A Maoist Like His Wife, Anita Dunn

"struggle session"

From Investor's Business Daily, here, which thinks the dots connect to Obama:

But as the Wall Street Journal's Kimberly Strassel reminds us, Obama's 2008 campaign was demanding the Justice Department criminally prosecute conservative groups with 501(c)4 tax-exempt status. Then, last year, President Obama's re-election campaign "targeted private citizens who had donated to Romney groups."

The chief operative? Longtime Democratic Party lawyer Robert Bauer, general counsel for Obama's presidential campaigns, White House general counsel during Obama's first term, Democratic National Committee general counsel, and the Democrats' counsel in President Bill Clinton's Senate impeachment trial. And, not least, husband of Democratic political strategist Anita Dunn, White House communications director in Obama's first term, and now an MSNBC contributor.

Actually, the dots connect beyond Obama to Mao.

Maggie's Notebook prominently showcased Bauer and Dunn as a couple already in 2009, here. We should have understood better what this implied. While Anita Dunn is on record stating her admiration for Mao, Bauer actually has been busy echoing Maoism in his capacity as Obama's personal lawyer and as general counsel for the White House and the Obama political campaigns.

One of the main techniques of Mao's Great Leap Forward in China was for local communist parties to target landowners for public intimidation in "struggle sessions" in order to break the grip of counterrevolutionary power in the countryside. They ended up executing an estimated 2 million of them during the 1950s. As a feature of the permanent revolution, the struggle sessions eventually made it to the cities where counterrevolutionary rival communists were frequently targeted and persecuted.

These struggle sessions have been adapted to the new revolutionary environment by the Obama Left. Whether it's Acorn cadres occupying bank lobbies, or using the Justice Department, the IRS, and individual US Representatives and Senators to single out private citizens, businesses and nonprofits on political grounds, targeting one's political and class enemies with whatever means are available comes straight from the dark ages of 20th century communism, brought to you by ObaMao and Company.

China was ready to welcome one of their own.

The new Great Leap Forward

No bank failures so far tonight

The total stands at 13 for 2013.

Happy full moon everybody!

Rush Limbaugh Continues In Error: McCain Did NOT Get More Votes Than Romney

Rush Limbaugh can be so wrong sometimes it's infuriating, and once he gets some misinformation into his head, it's almost impossible to get it out of there. He can complain about the low information voters all he wants, but it's the lazy misinformation he spews which we all need to worry about, as when Rush won't allow Donald Trump into the conservative movement because The Donald wants to raise tariffs to beat the hell out of China. That's not conservative, Rush says, nevermind a tariff regime funded this country clear through the War Between The States and many decades thereafter. The fact is that Rush Limbaugh's version of conservatism doesn't win because it can't imagine America before 1913, isn't intelligent and doesn't compel assent for that reason. America still has an institutional memory, and the people still can tell when someone makes sense and when they don't.

Rush opened the second hour of the program today, here, claiming for the umpteenth time that Romney got fewer votes than McCain, which he didn't: "Obama got millions fewer votes in 2012 than he did in '08, but so did Romney get many million fewer votes than did McCain." This phone-it-in comment is in service of Rush's new vote suppression meme, i.e. Democrat suppression of Republicans, courtesy of the new IRS nonprofits targeting scandal. But the theory is completely unsupported by the facts of the last election. How different is this misinformation than the idea swallowed hook line and sinker by Republicans that they lost in 2012 because they lost the Hispanic vote? Maybe they lost the white vote. 

Romney polled 60.93 million in 2012 and McCain 59.95 million in 2008, okay? And Romney lost the election by half as many votes in the swing states as McCain lost it by in those same states. Romney was a better candidate than McCain, but he was still a bad candidate.

With what's happened with the IRS scandal I don't think Rush will ever be convinced he's wrong about the 2012 election numbers, even though he is.

That would require some effort on his part, and as we all know, the older we get, the harder that gets.

IRS Scandal Under Democrat Shulman Is The Bipartisan Gift That Keeps On Giving

Rush Limbaugh, here:

"By the way, everybody is making a big deal out of the fact that Shulman was a Bush appointee. All right, let me deal with that. We must. Yeah, he was a Bush appointee, but he's a Democrat. Douglas Shulman is a Democrat. He gave the Democrat National Committee $250 a month before Bush appointed him to his job. Do you know what Shulman is? Shulman is one of countless Bush appointees who were put there by Bush -- Democrats -- in order to show bipartisanship.

"Remember he had that Florida aftermath -- all this acrimony, hatred and partisanship -- and Bush put a lot of Democrats in positions, and he left a lot of Democrats in positions -- as a show of good faith, in an attempt to show compassionate conservatism, in an attempt to mend fences with the Democrats. It didn't matter. It never will work that way. It never does matter. But that's what Bush was trying to do. Shulman's a Democrat. He's a lifelong Democrat. He's a Democrat partisan."

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President George W. Bush appointed Douglas Shulman to run the IRS in November 2007 as the political wheels were coming off the Bush administration bus after the Democrats took over the US House in the November 2006 elections, and as the economic wheels began coming off the country as the housing bubble popped and banks began to fail in 2007.

Meanwhile we have now learned from Kim Strassel of The Wall Street Journal here that the general counsel of the 2008 Obama campaign and later also the general counsel in the White House, Bob Bauer, was part of a new and broad attempt by Obama's leftists to suppress conservatives precisely on their own nonprofit turf:

'Bob Bauer, general counsel for the campaign (and later general counsel for the White House), on the same day [August 21, 2008] wrote to the criminal division of the Justice Department, demanding an investigation into AIP [American Issues Project], "its officers and directors," and its "anonymous donors." Mr. Bauer claimed that the nonprofit, as a 501(c)(4), was committing a "knowing and willful violation" of election law, and wanted "action to enforce against criminal violations."

'The Bauer onslaught was a big part of a new liberal strategy to thwart the rise of conservative groups. In early August 2008, the New York Times trumpeted the creation of a left-wing group (a 501(c)4) called Accountable America. Founded by Obama supporter and liberal activist Tom Mattzie, the group—as the story explained—would start by sending "warning" letters to 10,000 GOP donors, "hoping to create a chilling effect that will dry up contributions." The letters would alert "right-wing groups to a variety of potential dangers, including legal trouble, public exposure and watchdog groups digging through their lives." As Mr. Mattzie told Mother Jones: "We're going to put them at risk."'

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Someone at the IRS embarked on the exact same strategy of creating a chilling effect at least from March 2010, perhaps in the wake of Citizens United in January 2010, but the strategy, and the practice, predates it.

How Shulman could not have known about it is hard to believe.

  

Old Yeller, New Yellen?

“When the time has come, am I going to support raising interest rates? You bet.” 

Janet Yellen, quoted here.

George Will's Euphemism For The Left's And Obama's Tyranny

"[P]rogressivism’s agenda — unchecked executive power."

Read all about it, here.

Former Sen. Phil Gramm Underestimates The Cost Of Obama's Debt Bomb

Sen. Phil Gramm for The Wall Street Journal, here:

Since the World War II era, the average maturity of outstanding federal debt has been about five years, and the average interest cost on a five-year Treasury note has been 5.9%. At this interest rate, the expected cost of the Obama debt burden will eventually approach some $590 billion per year in perpetuity, exceeding the current annual cost of any federal program except Social Security.

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As might be expected, the senator who didn't understand the consequences of the final repeal of Glass-Steagall in 1999 grossly underestimates the cost of carrying the national debt under a normalized interest rate environment.

Interest expense on the debt for fiscal 2009-2012 has averaged $404 billion annually. The debt to the penny on October 1 for each year 2009-2012 has averaged $14.1 trillion annually. Therefore the implied interest rate has been 2.87% annually. Normalized to 5.9% as he suggests, which is just a little more than double the current average rate, the debt service interest expense would have been $832 billion annually, over 40% higher than the former senator predicts down the road.

Of course, not all debt resets instantly in a rising interest rate environment, but in view of the number, size and long duration of many of the securities on the fed's balance sheet which would suffer immediate declines in net asset values, it is difficult to imagine how the fed could prevent a bond market debacle and unwind everything as gradually, and as imprudently, as it wound it up in the first place.

This is what passes for conservatism, folks.